Barclays compliance chief slammed by Banking Commission for refusing to take responsibility for string of scandals

The head of compliance at Barclays was slammed by a powerful banking watchdog for refusing to take any responsibility for the string of scandals that occurred under his watch.

Mike Walters stunned the Banking Commission’s joint committee by claiming that he was not responsible for compliance at the lender.

The clash came as the former bosses of HBOS – Sir James Crosby and Andy Hornby – were finally summoned to appear in front of the main Banking Commission over their role in its collapse. For the first time it has appointed barristers to help forensically probe the actions of failed bankers.

Stunning: Barclays compliance chief Mike Walters said it was impossible to monitor the firm single-handedly

Chairman Andrew Tyrie said: ‘Two of
these men were on the bridge when HBOS failed, when public money was
needed to rescue it and when trust in our banking industry collapsed
almost completely.’

But yesterday it was Barclays’ turn to face the music.

As head of compliance at the lender
since January 2006, Walters has managed to cling on to his job despite
the firm’s reputation sinking to an all-time low.

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Barclays was fined £290million in
June for rigging interest rates and has set aside £2billion for
mis-selling payment protection insurance. It is also heavily implicated
in the mis-selling of complex interest rate swaps alongside loans to
small businesses. Mark Garnier, an MP who led the interrogation by the
joint committee criticised the bank for its ‘atrocious’ customer
complaints record. But he focused his attack on the Libor rate rigging.

Damning emails showed how Barclays
traders promised those responsible for setting the benchmark rate
bottles of champagne for manipulating the figures. Garnier said: ‘How
did you allow them to be influenced? Where does the buck stop?’ Walters,
who heads up a team of 1,300 staff, admitted there has been a ‘break
down in compliance and culture’.

But he added: ‘It’s not the
compliance function’s responsibility to make Barclays compliant,’
arguing that it was impossible to monitor the entire firm ‘single
handedly’. Garnier said this was a good argument to ‘break the banks
up’.

Rich Ricci, controversial boss of the
investment bank, admitted there were ‘cultural failings’ but insisted
most of its staff had ‘the right culture and values’.

Questions were also raised about
Barclays’ attempt to rebuild its reputation, with Garnier suggesting it
was a ‘cynical attempt’ to gain more customers. He said: ‘The reputation
of banks is shot to pieces.

‘Now, if you can be seen to be the most virtuous, you will win the most customers.’